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June 1, 2012

Focus Financial’s Colony Group to Merge With Mintz Levin

Combined assets will reach $2.5 billion

Focus Financial Partners on Wednesday announced that partner firm The Colony Group will merge with Mintz Levin Financial Advisors under the Colony name.

The combined assets from Colony and MLFA will reach approximately $2.5 billion. The terms of the deal were not disclosed.

Focus is an international partnership of independent, fiduciary wealth management firms with more than $50 billion in assets. The Colony Group was founded in 1986. It oversees $1.4 billion in client assets. It has been a Focus partner since October.

The firm saw many reasons to join Focus, according to Michael Nathanson, chairman and CEO of Colony. “Among them,” he told AdvisorOne on Thursday, “joining would provide a great opportunity to collaborate with the advisor community.”

The spirit of collaboration ultimately led to the decision to merge with Mintz Levin. “We saw Mintz Levin as an opportunity to combine forces with a like-minded fiduciary advisor to better serve our clients, better serve our employees and better serve our partners,” Nathanson (left) said.

Both The Colony Group and Mintz Levin represent a “client service franchise with an unending commitment to serving clients with a holistic model,” Michael Paley, managing director at Focus, told AdvisorOne.

Initially, Nathanson said, the transition will be seamless to clients—other than the name change, of course. “We set about to further the task of seeking out ways to better serve clients.” he said. “We’re looking at practices used for many years by Mintz Levin and by Colony and are looking for the best collective practices. Over time, we expect to improve service even further.”

As for specific types of services the firm will be able to bolster, Nathanson said the merger would allow the firm to offer greater access to research and better utilization of technology, including reporting, relationship management and financial planning solutions.

“This is a continuation of the enhancements that have been underway since we began our partnership with Focus last year,” Nathanson said.

“We see this transaction as an acceleration of the ongoing evolution” of service at the two firms, Paley added.

Mintz Levin was founded in 1998 to serve high-net-worth clients with between $1 million and $30 million in assets. The average client has approximately $3 million. The firm will adopt the Colony name and join its Boston headquarters. Founders Robert Glovsky and Cary Geller will join the Colony executive management team.

“It has to do with long-term continuity of the business,” Glovsky (right) told AdvisorOne on Thursday. “If nothing else, I’m a planner. I wanted to make sure there was a plan in place for our staff long term and for the clients long term, and Colony’s structure is conducive to that.”

He points to Colony’s equity model—19 people own equity in the firm—and the very strong cultural fit between the two firms as factors in the decision to join Colony, as well as their long history together.

“We’ve known them for a long time. They’ve been one of our best peer groups in Boston: an outstanding group of counselors who think the way we do, who put financial planning front and center.”

The transaction is the third so far for Focus. In 2011, the firm did eight transactions.

There are two aspects to this particular transaction that make it unique, Rudy Adolf (left), founder of Focus, told AdvisorOne on Friday. First, “only seven months [since joining Focus], Colony has doubled their size.” The second, he said, is the level of quality of the firms involved. Prior to joining Focus, Colony was a “No. 1-rated Schwab firm.”

It won Schwab’s Best-in-Business IMPACT Award in 2010.

“I couldn’t think of any equivalent in the last several years,” Adolf said.